Contesting the Collection of a Judgment
This section will answer questions including:
- What types of money and property cannot be taken to collect a judgment?
- How does the Debtor claim an exemption?
- What happens after the Debtor files his affidavit claiming exemption?
- When is a hearing on the property exemption to be scheduled?
- What you can do if the creditor requests a hearing?
- If the judge denies my exemption claim, do I have any appeal rights?
- Can exempt property ever be taken?
- What can I do if I have property or wages which are not exempt from execution?
There are certain types of property that cannot be taken from you even if you have a judgment against you. This property is called exempt property. Included in the property which is exempt under Nevada law (NRS 21.090) are:
- 75% of your disposable earnings or 50 times the minimum wage (currently $362.50 per week) which ever is higher.
- Payments received as disability, illness or unemployment benefits
- Workers Compensation (SIIS) benefits
- Welfare benefits, public assistance benefits from the Nevada State Welfare Division (TANF, Food Stamps, etc.) or local government (like General Assistance)
- Veterans benefits
- Social Security and Supplementary Security Income
- Social Security disability payments
- Amounts paid pursuant to a court order for child support or maintenance of a former spouse.
- Vocational rehabilitation benefits
- Certain federal and state retirement monies
- Certain Individual Retirement Accounts
- Life insurance proceeds, if your annual premium is less than $15,000
- One vehicle, if your equity (the market value minus how much you owe) is under $15,000, unless the lawsuit concerned the loan on the vehicle.
- A "homesteaded" house or mobile home, even if you do not own the land. The exemption protects up to $550,000 of the home's value. It can protect up to 100% if the judgment is for a medical bill or you establish "allodial title". The homestead exemption does not apply if the judgment was for the mortgage or a mechanic's lien upon the property.
- Necessary household goods, personal effects, and yard equipment, (maximum $12,000).
- Professional Libraries, equipment, supplies, and the tools, inventory, and materials to carry on your trade or business for the support of yourself or your family (maximum $10,000); Private libraries, works of art, musical instruments and jewelry which belong to you or your dependent (maximum of $5,000).
- Compensation for personal injury up to $16,150 (excluding pain and suffering or actual pecuinary loss) to you or your dependents.
- Certain compensation for the wrongful death of a person upon whom you were dependent to the extent reasonably necessary to support you and your dependents.
- Compensation for the loss of your future earnings or the future earnings of a person upon whom you were dependent to the extent reasonably necessary to support you and your dependents.
- Restitution payments to you for a criminal act.
- A security deposit on your primary residence.
- Personal property, not to exceed $1,000 in total value, if the property is not otherwise exempt.
- A tax refund received from the earned income credit provided by federal law or a similar state law.
- Proceeds received from a private disability insurance plan.
- Money in a trust fund for funeral or burial services pursuant to NRS 689.700.
- Compensation that was payable or paid pursuant to chapters 616A to 616D, inclusive, or chapter 617 of NRS as provided in NRS 616C.205.
- Unemployment compensation benefits received pursuant to NRS 612.710.
- Benefits or refunds payable or paid from the Public Employeesâ€™ Retirement System pursuant to NRS 286.670.
- Money paid or rights existing for vocational rehabilitation pursuant to NRS 615.270.
- Public assistance provided through the Department of Health and Human Services pursuant to NRS 422.291.
- Child welfare assistance provided pursuant to NRS 432.036.
- If money has been deposited into a personal bank account electronically within the immediately preceding 45 days from the date on which the writ was served which is reasonably identifiable as exempt from execution under federal law, notwithstanding any other deposits of money into the account, $2,000 or the entire amount in the account, whichever is less, is exempt.
- For personal bank accounts which do not contain exempt federal funds deposited electronically, $400 or the entire amount in the
account, whichever is less, is is exempt, unless the writ of execution or garnishment is for the recovery of money owed for the support of any person.
Note: This is not a complete list of exemptions. Consult an attorney to determine if you have any other exemptions.
Just because property attached is exempt, the Debtor must bring this to both the Creditor and Courtâ€™s attention. In order to claim exemption of any property levied on, the debtor must, within 10 days after the Notice of Execution is mailed, serve on the constable and plaintiff and file with the clerk a claim of exemption on a form provided by the clerk. NRS 21.112. The clerk will also provide a checklist and description of the most commonly claimed exemptions, instructions concerning the manner in which the property must be released if no objection is filed and an order to be used by the court to grant or deny an exemption. No fee may be charged for providing such a form or for filing the form with the court.
The claim of exemption is to be accompanied by all documents relied upon by the party claiming the exemption. JCRLV 27.
The constable or sheriff is to release the property to the Debtor within 9 judicial days after the claim of exemption has been served unless the Creditor files an objection to the claim of exemption and notice for a hearing are not filed within 8 judicial days after the claim of exemption has been served NRS 21.112.
If an objection to the claim of exemption and notice for a hearing is filed by the Creditor with the court within 8 judicial days after the claim of exemption was served, the Creditor shall also serve a notice of the date of the hearing not less than 5 judicial days before the date set for the hearing. NRS 21.112
Be prepared to prove at the hearing that your property is exempt. Bring receipts, bills of sale, Kelly Blue Books, assessors' statements, vehicle registration renewals, monthly bank statements or whatever else is necessary to prove your claim.
If you convince the judge of your claim, he or she will order that the money or property be released to you. If the judge determines that the property is not exempt, he or she will not return the property to you.
Yes. It is best to contact an attorney immediately to obtain assistance.
There are certain situations in which otherwise exempt property can be executed upon. Included are:
- When the judgment entered against you is for child support, some of the listed exemptions such as 75% of take-home pay, do not apply.
- Where a bankruptcy court orders that the property be taken.
- If the judgment is to satisfy certain tax liens.
- Where the judgment was for the purchase, loan or improvement on that property - for example, the remaining installment payment on a used car which you bought.
To avoid garnishment or attachment if you have non-exempt wages or property generally your options are to either:
- Pay the debt either in full or through a payment plan that is negotiated with the creditor or imposed by a court;
- Convert non-exempt property to exempt property- for example, filing a homestead exemption on your house; or
- Erase the debt through a bankruptcy.
For expert assistance in deciding the option which is best for you may wish to contact the Consumer Credit Counseling Service of Southern Nevada, 2650 S. Jones Blvd., Las Vegas, Nevada (702) 364-0344. This non-profit organization offers counseling, education, debt management (looking at all of your income, expenses and debts) and specialized counseling (student loans, fax repayment, establishing credit, etc.). The agency will also help you understand the pros and cons of bankruptcy.
To file a bankruptcy, you should consider hiring an attorney if you can afford one. You should also consider attending a free community legal information class on bankruptcy offered by Legal Aid Center of Southern Nevada and the William S. Boyd School of Law; it will help you prepare for the process. The class manual and video are located at www.lacsn.org. If you are unable to find an attorney who you can afford, there are a limited amount of attorneys who are willing to accept a case without charge through the LACSN Pro Bono Project. You may apply at the end of the bankruptcy information class.